Habban Shah v. Sheruddin 2026 INSC 451 - S.28 Specific Relief Act
Specific Relief Act 1963- Section 28- Moving of an application under Section 28 of the Act for rescinding the contract for non-compliance of the condition is not mandatory rather optional and immaterial and that the court in a given circumstance is not powerless to treat the contract as having rescinded for non-compliance of the condition - Section 28 (1) of the Act provides for depositing or paying the balance sale consideration within the time allowed or to seek recession of the contract in the event of default even though the decree of specific performance has been granted. Sub-Section (4) of Section 28 of the Act bars a separate suit for any relief which can be claimed in the same suit by moving an application under Section 28 of the Act-The power of the Court under Section 28 of the Act is discretionary and can be exercised on equitable consideration. The exercise of such discretion must be equitable to both the sellers and purchasers- The default, if any, subsequent to decree for the specific performance resulting in the recession of contract has to be decided having regard to the broad terms of Section 28 (1) and Section 28 (4) in exercise of equity jurisdiction so as to give quietus to the dispute- (Para 39) [Context: In this case, the Supreme Court held that the decree for specific performance dated 31.10.2012, which required execution of the sale deed within three months on payment of the balance sale consideration, was a conditional and essentially preliminary decree that became inexecutable when the decree holder failed to deposit the balance amount or seek extension of time within the stipulated period.]
Specific Relief Act 1963- The decree passed in a suit for specific performance is in the nature of a preliminary decree and therefore the Court passing the same does not become functus officio as soon as the decree is passed but retains control over the decree even after the passing of the decree till the sale deed is executed or the decree is rendered inexecutable. (Para 39)
Code of Civil Procedure 1908 - Order XXI - Mere dismissal of the first execution application on the ground of default does not preclude the decree holder from filing a fresh execution within limitation. (Para 23)
Case Info
Case Information
Case name: Habban Shah v. SheruddinNeutral citation: 2026 INSC 451
Coram:Justice Pankaj Mithal and Justice S. V. N. Bhatti
Judgment date: 6 May 2026 (pronounced at New Delhi)
Case Law and Citations Referred
- Balbir Singh and Another v. Baldev Singh (Dead) through his legal representatives and Others, (2025) 3 SCC 543
- Bhagyoday Cooperative Bank Limited v. Ravindra Balkrishna Patel, (2022) 14 SCC 417
- P.R. Yelumalai v. N.M. Ravi, (2015) 9 SCC 52
- Prem Jeevan v. K.S. Venkata Raman and Another, (2017) 11 SCC 57
- Ram Lal v. Jarnail Singh (now Deceased), through its LRs and Others, 2025 SCC OnLine SC 584
- Dr. Amit Arya v. Kamlesh Kumari, 2025 SCC OnLine SC 288
- N.P. Thirugnanam (Dead), by LRs v. Dr. R. Jagan Mohan Rao and Others, (1995) 5 SCC 115
- Surinder Pal Soni v. Sohan Lal (Dead) through LRs, (2020) 15 SCC 771
Statutes / Laws Referred
- Specific Relief Act, 1963
- Section 16(c) (readiness and willingness)
- Section 20 (discretionary and equitable nature of relief)
- Section 28, especially Section 28(1) and 28(4) (post‑decree powers: deposit of consideration, rescission, bar of separate suits)
- Code of Civil Procedure, 1908 (CPC)
- Order XX Rule 12A (requirement to specify time for payment in specific performance decrees)
- Sections 148 and 151 CPC (extension of time / inherent powers – referred to as provisions under which time could have been sought)
- Limitation Act, 1963
- Article 136 of the Schedule (12‑year limitation for execution of decrees)
Three‑Sentence Brief Summary
The Supreme Court held that the decree for specific performance dated 31.10.2012, which required execution of the sale deed within three months on payment of the balance sale consideration, was a conditional and essentially preliminary decree that became inexecutable when the decree holder failed to deposit the balance amount or seek extension of time within the stipulated period. Relying on precedents such as P.R. Yelumalai and Prem Jeevan, the Court ruled that non‑compliance with such conditions leads to the suit being treated as automatically dismissed and the contract as rescinded under Section 28 of the Specific Relief Act, even without a separate application by the judgment debtor. Balancing equities, it set aside the orders of the Executing Court and High Court, closed the execution, and directed refund of the earnest money of Rs. 80,000 with 8% simple interest (or, failing refund, sale of ½ acre land to satisfy this amount).